Energy stocks performed significantly better than the broader S&P 500 index for most of 2022 due to rising oil and gas prices aggravated by the Russia-Ukraine war. According to the CPI report of December 2022, the energy index rose 7.3% over the past 12 months. The fuel oil index rose 41.5%, and the index for natural gas increased 19.3% over the same period.
Moreover, investment firm Goldman Sachs Group, Inc. (GS) anticipates Brent crude to trade at $105 a barrel by the fourth quarter of 2023 due to “solid” growth in global oil demand. It forecasts an increase in oil demand by 2.7 million barrels per day this year. GS believes that OPEC’s significant pricing power will limit downside risks to its bullish oil forecast.
